Want to Know Where Global Commerce is Headed? Look to China

This month we hosted our second Retail Connect conference in Shanghai, with more than 160 attendees. I had the pleasure of being a guest speaker, and learned a lot about the current state of ecommerce in China, which I believe foreshadows global digital commerce.

Retail Connect’s highlight in 2016 was the presentation of Jason Li from Tencent, the company behind the record-breaking WeChat. He formalized the vision that a user’s WeChat ID will become more important than their phone number, because a WeChat ID stays with an individual for life. He cited mind-boggling statistics what would be the envy of other: more than 800 million monthly active users and a penetration rate of 93% in established markets like Shanghai, Beijing, Guangzhou, Hangzhou and Shenzhen.

It was interesting to hear how WeChat empowers behavior that we describe in our report on the Democratization of Retail: Consumers want to know about the products they use; more and more, brands leverage the function WeChat Scan for this purpose. Li demonstrated how consumers scan milk bottles from Mengniu Dairy to look up details about the environmental conditions at the farm from which the milk originated. Another example: Fu Rong Wang, a popular tobacco brand in China, lets consumers scan their cigarette packs to prevent the distribution of counterfeiting products.

Pacific Coffee offers an amazing use case of successful Online-to-Offline (O2O): Customers select their favorite coffee flavor online. Based on GPS information, the order gets dispatched to the closest store while the app provides directions. Once the consumer enters the store, the coffee is ready to pick up – and already paid through WeChat Pay. Kentucky Fried Chicken is offering the same smooth service to their Chinese customers.

Li also provided insights into WeChat’s capabilities on social, and with loyalty programs. Melishou, one of the booming social networks in China, got recently integrated into WeChat. Conversions that happen within the WeChat environment can easily be shared on the social network, while the profile data can be used to enhance loyalty profiles. Various examples from Chinese and international brands demonstrated how an unified experience for a consumer should look.

Several customer presentations provided proof of how digital commerce technology from Demandware, a Salesforce company, can empower commerce in the enormous China market.

Steve Lin, Retail Director of ECCO China, illustrated how they have customized our platform to build a truly localized digital experience for Chinese consumers; one that can effectively compete with the incumbent marketplaces.

“We love and hate Tmall,” he said. “We want to have direct interactions with our customers.” Lin explained his stance after mentioning how they integrate with WeChat and domestic SMS gateways to accelerate mobile commerce.

ECCO is thinking mobile first for China, which often correlates to “speed first.” The one-click-checkout on every product detail page, so far only implemented for China, fosters this approach. Steve Lin said he was happy to speak to other customers because he wants to give back: “If you want to bring your brand to Asia, learn from the many other Demandware retailers who have already rolled out their sites to China, Japan, Korea and East Asia,” he said as he concluded his presentation.

Ye Zhang from Accenture China also focused on mobile during his presentation. Accenture built the Chinese storefront of beauty brand Kiehls, developing a fully responsive design to meet consumers’ experience on their mobile devices. Several Business Manager modifications allow the merchandisers to tailor the shopping experience specifically to mobile. Zhang highlighted the sticky category menu on the bottom of every page.

Once again, Retail Connect Shanghai proved the vital ecommerce community of China going ahead of global power trends and showcasing to us, what we might see over the next years to come in the Western markets.